RSIwaarden

RSIwaarden are the numerical outputs of the Relative Strength Index (RSI), a momentum oscillator used in financial market analysis to measure the speed and change of price movements. The RSI is designed to help traders assess whether an asset may be overbought or oversold and to identify potential trend reversals or continuations.

Calculation and range

The RSI is typically calculated over a chosen period N, commonly 14. The procedure involves determining the average gain and average loss over the period, computing the relative strength (RS) as the ratio of average gain to average loss, and transforming this into a value between 0 and 100 using the formula RSI = 100 - (100 / (1 + RS)). The resulting RSIwaarden range from 0 to 100, with higher values indicating stronger upward momentum and lower values indicating stronger downward momentum.

Interpretation

Conventional thresholds are 70 and 30: readings above 70 suggest that an asset may be overbought, while readings below 30 suggest it may be oversold. A move above or below the 50 mark can indicate a shift in momentum, and divergences between price action and RSIwaarden can signal potential reversals. Traders may adjust thresholds to 80/20 in markets with persistent trends.

Variants and usage

Beyond the standard 14-period RSI, other periods such as 9, 21, or custom lengths are used to capture different timescales. RSIwaarden are often combined with price action, support and resistance, or other indicators to form trading strategies and risk management rules.

Limitations

RSIwaarden can produce false signals, especially in strong or prolonged trends where readings stay in overbought or oversold zones. The indicator depends on historical price data and may lag actual price changes. Proper interpretation usually requires corroborating evidence from other analyses.